Tom Keighley

Venture Capital Trust funds grow by £19 million

Venture Capital Trusts in the UK had total funds under management of £2.896 billion at the beginning of October, more than ever since their launches in 1995.

Funds grew by £19 million in the first six months of this year and the ten largest VCTs continued to manage three quarters of the total funds, according to research from financial services firm Hargreaves Lansdown.

£94 million was raised by the issue of new shares whilst £121 million was returned to shareholders in the form of dividends, in the same period.

Adrian Lowcock, senior investment manager at Hargreaves Lansdown said: “The record assets under management in VCTs are a testament to their success. It is no coincidence funds under management are concentrated to a small number of managers. Those with established, successful track records continue to attract funds year after year.

“For investors the attractions of participating in top-ups to existing VCTs, rather than backing brand new VCTs, are clear. Top-ups provide access to mature portfolios with the potential for early tax-free dividends. Brand new VCTs can take a number of years to become fully invested and mature.”

VCTs were established in 1995 as a vehicle to encourage individuals to invest in smaller trading companies and tax reliefs are available to those who do so.

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